It's a modest budget, but...
...you can still get surround sound for that size room.
Look at the Onkyo HTIB solutions. Most should suffice. No need to get 7.1 either- stick w/ 5.1. Amazon has quite a few, FWIW.
I prefer to separate the BD player from the main AV receiver & speakers. Right now you can find a basic BD player for $50 if you don't require all the add-ons like smart apps, etc. $100 gets you the whole shebang though. So you are pretty close to budget anyway.